Tokenizing Equity Rights of the Most Promising Private Companies around the Globe

By combining the emerging secondary market and Blockchain; The Elephant is an enhanced online platform that opens the door to investments in the world’s most auspicious, important and interesting private companies prior to their liquidity event.

Tokenized Secondary Market Platform for Shares of Pre-IPO Companies

Enabling pre-IPO companies’ shareholders to sell their shares prior to a liquidity event and for investors to invest in such shares through dedicated partnerships represented by Digital Tokens.

The First Tokenized Secondary Market Platform

Provides liquidity to equity rights in shares of leading privately held companies through equity-backed dedicated tokens to unlock the value of shares of these "unicorn" and late-stage companies.

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Vision

To unlock the value of shares of private unicorn and late-stage companies by providing tokenized liquidity.

Our Mission

The Elephant introduces the first security token backed by shares of the most promising private companies around the globe.

Our mission is to open the door to investments in shares of the world’s most auspicious, important and interesting private companies (unicorns & high-profile companies), prior to their liquidity event.

The platform enables shareholders of pre-IPO companies to sell their shares prior to a liquidity event and for investors to invest in such shares through dedicated partnerships represented by Digital Tokens.

By tokenizing equity rights of the most promising private companies around the globe, we make it liquid at all times

Tokens Tied to Real World Financial Assets

Unlike most cryptocurrencies, our PEC and Dedicated Tokens are tied to real-world financial assets – shares in private companies, with independent expected (though speculative) ROIs. This means that a Holder can, on the one hand, enjoy an increase in the value of the PEC or the Dedicated Tokens but at the same time he or she does not depend on it to generate a profit. Even in the event that the value of the PEC decreases, it does not affect the rights of the Holder to participate in Dedicated Token Offerings or the rights to revenues from the Platform. Likewise, even in the event that the value of the Dedicated Token decreases, upon an IPO or Exit of the Target Company the Holder will enjoy the returns regardless (See further section 6.5 of the White Paper).

Accordingly, our tokens are clearly defined as securities, and are therefore designed to conform to all applicable laws and regulations pertaining to the issuance and marketing of securities for investment funds, including verification of token buyers as Accredited/Qualified Investors in accordance with applicable regulations.

Some of the Leading Companies Whose Shares Are Currently Listed by their shareholders on the Platform

What sets us apart?

We are the only solution to solve the liquidity challenge for buyers and sellers, by combining the growing pre-IPO secondary market and the Blockchain technology and related digital currencies.

The Elephant Platform enables a low entry point for buyers and sellers, opening the secondary market to a much broader variety of players with greater opportunities.

The Secondary Market

By its nature, private companies’ equity asset class is illiquid, intended to be a long-term investment for buy-and-hold investors. For the vast majority of private equity investments, there is no listed public market; however, there is a robust and maturing secondary market available for sellers of private equity assets.

The private secondary market has experienced rapid growth in recent years, due to a very high IRR and the lengthening of the transition from venture-backed company to IPO – from 3-5 years in 2000 to 10-12 years in 2016. The volume of secondaries transactions increased by 800% over the last 13 years from $7B in 2004 to $58B in 2017 (source: Greenhill Cognet).

The Elephant Solution

The Tokenization Mechanism

The company was founded to solve the need of private companies’ shareholders for liquidity for their shares, given the fact that more companies choose to stay private for long periods, resulting in:

Shareholders (founders, seed investors, current and former employees, service providers and to some degree even VCs) having to wait a substantially longer period before they can liquidate their shares.

Traditional investors are denied access to the significant valuation increment that occurs prior to an IPO or an exit.

Our mechanism is based on the creation of dedicated partnerships that buy the shares from the original shareholders and enable investors to invest in these shares by buying participation rights in these dedicated partnerships.

To facilitate greater liquidity for buyers who step into the shoes of the sellers, in late 2017, we have made the decision to tokenize the participation units of these partnerships by creating a dedicated security token representing these participating units, turning them into liquid and transferable assets, governed by smart contracts.

The Dedicated Tokens are equity backed. Upon an IPO or M&A of the companies whose shares are held by the partnership:

The platform operator will distribute the net realized gains to the holders of the Dedicated Tokens of these LPs.

All Dedicated Tokens of that dedicated partnership will be burnt.

The Elephant tokenized platform is the solution the private market has been waiting for!

PRIVATE SALE

PEC – the Platform Token

The Elephant Platform is a members-only platform. Membership is secured through the holding of PEC, The Elephant Platform’s token. To qualify as a member and hold or purchase PECs, an investor must be classified as an accredited or qualified investor and complete our Know Your Client (KYC) process. Once qualified as an Elephant Platform member, investors are entitled to receive a portion of the platform’s annual revenues and participate in Dedicated Token offerings. Investing through the Elephant Platform enables the investor to enjoy token value increases, while still being protected by the asset backing the token and a potential IPO/exit.

Platform revenues are derived from fees collected from share sellers upon completion of the sale of their shares, as well as annual management fees collected from dedicated partnerships. In addition, a success fee is collected when a liquidity event of shares held by dedicated partnerships is held.

Our Token Offering – Private Sale

In order to turn our platform into a leading, innovative, global platform that offers a diversified and wide range of tokenized and liquid investment opportunities, we are performing an Initial Exchange Offerings (IEO).

The goal of this IEO is to enable The Elephant to expand its already operating platform and shares portfolio into a leading global tokenized secondary market platform.

Participants in the PRIVATE SALE will receive PECs that will entitle them to:

Participation in Revenues:
PEC Holders will be rewarded with 20% of the annual revenues generated by the Platform arising from Dedicated Token Offerings (including fees from the Selling Shareholders and fees from the Investors) pro rata to their holdings of PECs out of all PECs in circulation, before any taxation applicable to the Platform or to PEC holders, if any. The distribution will be announced and distributed following the adoption of the annual financial statements and the results of the Platform for the preceding year. The Elephant will announce the date of the publication of the results, at least 10 days prior to such date.

Conversion of PECs and Participation in Initial Dedicated Token Offerings:
From the amounts invested in the IEO, 40% of such funds will be used by the Platform Operator to participate in Dedicated Token Offerings. Investors that participated in the IEO (and for the removal of doubt, no other PEC Holders that received PECs without participation and investment in the IEO) will be entitled to convert up to 40% of their PECs into Dedicated Tokens issued in the initial Dedicated Token Offerings on the Platform, on a pro rata basis with overallotment rights.